Vincent says that while price growth has been the more important factor over the past 40 years, this period incorporates the 1980s and 1990s, which featured "outsized price returns" that are unlikely to be repeated. He quotes Simon James, founding partner of Gore Browne Investment Management, who points to data suggesting that "the combination of dividend yield and dividend growth has constituted the entire return from equities" for four decades.

Guinness Asset Managment has issued a White Paper exploring the relative importance of dividends and share price appreciation as a source of growth:

"For an average holding period of one year, dividends accounted for 27% of total returns for the S&P500 since 1940. If we increase the holding period to three years, dividends account for 38%, five years it increases to 42%, over a ten year period it rises to 48%, and with a 20 year holding period dividends account for some 60% of total returns."

The White Paper also debunks the myth that senior executives resort to dividends when they have run out of ideas to grow the business. It says: "(Dividends) instill and indicate efficient capital management in mature businesses. Dividend policies "leave no room for vanity projects or frivolous uses of capital".

Matthew Page, CFA at Guinness, expands further on their position:

"We believe that the key is to focus on companies with a consistently high return on equity. There are the companies best-placed to be generating profits. It also helps weed out those companies that may be trading on a high yield because the company is distressed. We have seen no cuts by these companies in the last 18 months at all."